Your Housing Options
Looking for your first apartment? Or upgrading to better digs? There's a lot to consider before you take the plunge. Take a few minutes to think about what's important to you in your living space before you start pounding the pavement looking for the perfect apartment. Make a list of the most important features:
-
Access to your workplace
-
Access to public transportation
-
Being able to own pets
-
Laundry facilities
-
A parking spot or availability of on-street parking
-
Safety of the neighborhood
Identify the things you won't compromise on and those that would be nice but aren't absolute requirements. This will help you quickly rule out places that don't meet your minimum standards. If you can't find a suitable apartment in your price range, consider sharing a house or apartment with a roommate, or renting a studio or efficiency apartment.
You'll need to have two months' rent saved up before you rent an apartment: one month's worth for the security deposit, plus the first month's rent. Some landlords require that you also pay the last month's rent up-front, for a total of three months' worth of rent.
How Much Rent You Can Afford
Before you start seriously shopping around for an apartment or rental house, you need to know how much you can afford to pay. As a general rule of thumb, allow no more than 30 percent of your gross income for housing. If you're making $35,000 a year, you shouldn't pay more than $875 a month for rent. You'd be more comfortable at 25 percent, or $729 a month. If some or all of the utilities are included, you could pay higher rent. You don't want to be strapped for cash all the time because of expensive housing, so it's best not to go with the maximum you can afford.
Moving Back in with Your Parents
There's a growing trend for young people to return to their parents' home for a few years after college graduation so they can save money before striking out on their own. If this option is acceptable to you and your parents, with discipline you could save a significant amount of money over the course of a year.
Let's say rentals in your area are $600 a month, and your parents will let you live at home rent-free as long as you contribute to household expenses such as groceries and utilities. If you socked away what you'd be paying in rent living on your own, you could save $7,200 plus interest in a year — not exactly small potatoes. You'd have to earn as much as $10,000 in order to net $7,200 after taxes.
